Cargill: News Center - News Releases - 2006 - Cargill to Buy Cotton Ginning Busines...

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Cargill to Buy Cotton Ginning Business in Southern Africa

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April 7, 2006

Contacts: Geraldine OShea +44 1932 861174 Francis De Rosa +44 1932 861174

Note: This transaction was completed in July 2006. JOHANNESBURG, SOUTH AFRICA and COBHAM, UK Cargill has conditionally agreed to buy Afgris cotton ginning business in southern Africa. Cargill will acquire Afgris Clark Cotton business - and its interests in eight gins - as part of an expansion programme that will provide Cargills customers with greater variety, quality and availability of cotton. In a deal which will double its cotton volume in Africa, Cargill takes full ownership of three gins in Zambia, three in South Africa and a majority shareholding in a company owning two gins in Malawi. The acquisition is subject to regulatory approvals which Cargill is hopeful will be received within the next few weeks. Comments Paul Kinney, president of Cargills cotton business: There are valuable synergies between our respective operations that will provide genuine benefits both to our customers and also to local farmers. Clark has very strong links with farmers and good engineering skills, while we have significant risk management and international marketing experience. The combination will maintain an outlet for locally-produced cotton and, by selling crops abroad, bring in revenues for national governments. The eight gins currently produce around 150,000 bales of cotton a year and supply the international spinning industry and regional oilseed market. In the Malawi joint venture, Cargill will partner with Admarc, the Malawi governments agricultural and marketing corporation, which is the existing minority shareholder. The deal involves approximately 500 permanent employees in the three countries. During the high season between July and October an additional 3,000 to 4,000 seasonal workers are employed at the gins. Cargills international expertise in the cotton industry and reputation for business excellence, combined with Clarks good relationship with the growers, will help to enhance and develop the full potential of the gins, concludes Kinney. ### About Cargill: Cargill is an international provider of food, agricultural and risk management products and services. With 142,000 employees in 61 countries, the company is committed to using its knowledge and experience to collaborate with customers to help them succeed.

http://www.cargill.com/news-center/news-releases/2006/NA3008074.jsp

5/31/2011

Cargill: News Center - News Releases - 2006 - Cargill to Buy Cotton Ginning Busines... Page 2 of 2

Cargill merchandises cotton worldwide, originating produce grown primarily in the western hemisphere for sale worldwide to textile mills. From its Liverpool office in the UK, it originates cotton from parts of the developing world for sale to European and Asian textile mills and manages the operations of cotton gins in Tanzania and Zimbabwe. Cargills cotton operations in Africa Cargill owns three gins in Zimbabwe where it processes approximately 25% of the countrys cotton and two in Tanzania. The company currently works with more than 150,000 communal farmers and has a combined total of 400 cotton-buying stations in the two countries.

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http://www.cargill.com/news-center/news-releases/2006/NA3008074.jsp

5/31/2011